Elevating Global Development: The Key Role of DFC in Economic Diplomacy

Introduction

Good afternoon and welcome to an enlightening session with Scott Nathan, CEO of the U.S. International Development Finance Corporation (DFC), hosted by the Atlantic Council. In an era where economic diplomacy plays a pivotal role in global development, the DFC under Scott’s leadership, has emerged as a cornerstone in leveraging financial tools to foster private sector investments across various sectors including energy security, climate goals, global health, and more.

The BUILD Act and DFC’s Mandate

In 2008, the U.S. Congress passed the BUILD Act, aiming to enhance U.S. economic engagement in emerging economies, bolster national security, and advance foreign policy goals. The DFC, empowered by this act, has significantly contributed to supporting private sector investments, showcasing untapped potential in promoting global energy security among other strategic priorities.

DFC's Tools for Attraction

A core focus of today’s discussion revolves around DFC’s mandate and its innovative tools designed to attract more private capital into the energy sector. This comes at a crucial time as Congress prepares to vote on reauthorizing the BUILD Act, highlighting the organization's significant impact and future potential.

Leadership and Vision

Scott Nathan brings to DFC a wealth of experience from both public and private sectors, shaping a forward-looking approach towards investment in emerging markets. Under his guidance, DFC has embarked on groundbreaking deals across Africa, Latin America, and Sri Lanka, focusing on sectors that are critical to sustainable development and economic growth.

Global Impact and Strategic Partnerships

DFC’s commitment to advancing finance solutions to today’s challenges has led to collaborations with Atlantic Council’s centers, leveraging expertise to push boundaries in emerging markets. The partnership highlights a concerted effort towards addressing issues like energy security and digital infrastructure, crucial for global development.

Economic Diplomacy in Action

A prime example of DFC’s economic diplomacy is the recent investment in a deep-water shipping container terminal at the Port of Colombo, Sri Lanka. Contrasting with China’s development banking approach, DFC prioritizes supporting the private sector in commercially viable, for-profit projects that adhere to high standards of environmental, social, and labor practices. This strategy not only aids in economic development but also promotes U.S. values and foreign policy goals.

DFC’s Diverse Portfolio

From energy security in Central Europe to supporting small businesses in Angola, DFC’s extensive portfolio underscores its role in advancing U.S. foreign policy and national security interests. By focusing on commercially viable projects that align with strategic objectives, DFC is setting a new standard in international development finance.

Future Directions and Challenges

As DFC looks towards the future, the conversation touches on the importance of diversifying global supply chains, particularly in the renewable energy sector. Investments in solar panel manufacturing in India exemplify DFC’s commitment to reducing dependency on singular sources, promoting economic stability, and advancing environmental goals.

Conclusion

The U.S. International Development Finance Corporation stands at the forefront of economic diplomacy, driving significant impacts across the globe. With initiatives that span energy security to digital infrastructure, DFC’s efforts under Scott Nathan’s leadership exemplify a strategic approach to international development, poised to face the challenges of a rapidly evolving global landscape.

For more insights into DFC's transformative role in global development and economic diplomacy, watch the full session here.